A commercial lease is an agreement between a property owner and a business that needs space for its operations.Unless you are running your business from your home or another property that you own, you will most likely need to lease commercial space.While there is no typical lease template, all commercial leases should have a few necessary clauses.Establish how much rent will be paid and who is responsible for expenses such as renovations, repairs, property taxes, insurance and maintenance if you create a commercial lease by identifying the owner and renter.
Step 1: In writing, include all the terms of the agreement.
In order to be a binding contract, the commercial lease must include all parts of your agreement.If you and the landlord talk about an important part of the deal, write it into the lease.
Step 2: The parties and the property can be identified.
If there is a dispute in the future, your lease needs to be understood by someone other than you.The names of the parties must be included.The landlord and you must be named.You will need to list it by its name and officers if you are operating as a corporation.If you don't, you will probably use your own name.The property's address and description.
Step 3: The lease and related items should be included.
Be precise.Commercial leases tend to last longer than a year.Explain the terms of the renewal if there is an opportunity.There can be no confusion with the dates that the lease begins and ends.
Step 4: All information regarding the rental price should be included.
You can specify how much is paid and how often.Payment in any form is expected.Be sure to say so.If the tenant will have the option to renew the lease at the end of the term, note any rent increases that can be expected.
Step 5: The amount of the security deposit that the tenant will have to pay should be stated.
A letter of credit from your financial institution can be used.In the lease, state that.Explain the purpose of the security deposit, when it will be returned, and what circumstances might lead to losing it.
Step 6: List all the utilities that the landlord and tenant are responsible for.
Trash removal, electricity, water, telephone lines, and other utilities might be included.It's a good idea to include a note about how often the landlord can ask for increases in utility payments.
Step 7: It costs to address renovation.
Tenants will want to make changes to the property before moving in.The lease should identify the work that is to be done, should state who pays for those costs, and should address your recourse if work is not done on time.
Step 8: State who will pay for property taxes.
The costs are shared by both landlords and tenants.There is no confusion between the landlord and the tenant if you are specific about how those costs are calculated.Discuss how you will deal with future increases.
Step 9: There should be a section about subleasing.
In the future, you may need to subdivide the space and take on a tenant of your own.You could have a partner take on some of the responsibilities as a subtenant.Discuss the possibilities with the landlord.
Step 10: There are regulations on the signs.
Most commercial storefronts and office buildings have signs.If your landlord gives those signs, this should be mentioned in your lease.
Step 11: There should be a procedure for resolving disputes.
There should be a process that each party agrees to follow if there is a dispute.You hope that everything will be great at the beginning of your business.You have to anticipate problems and include procedures.What form of notice are you required to give each other?In order to correct a problem, how much notice is required from either party?Is mediation required before the case goes to court?Is there a limit to the damages that can be claimed?What is the limit and how is it calculated?
Step 12: The lease can be terminated if there are certain conditions.
You can't expect to get out of a commercial lease quickly.It is possible that your future is speculative if you are operating a new or start-up business.You may not be able to keep the lease for the full term if you want to be in business for a long time.Provisions that would allow you to end the lease early are included in the draft lease.Financial penalties or consequences will be incurred if the landlord or tenant breaks the lease.
Step 13: To get started, consider using a template.
Although every commercial lease needs to be tailored to your own specific needs and your particular agreement, you can get a good start by using a template.Many of the terms that are required to make a contract binding are included in this form.An outline for you and the other party to use in negotiating the terms of your deal can be provided by a good template.If you find any that you have not addressed, you may need to have another discussion about your agreement.Each of the fifty states has an online source of commercial lease templates from the Internet Legal Research Group.Small business owners and entrepreneurs can get help from SCORE.You can download a commercial lease template from them.
Step 14: An online template service is available.
There are online services that can help you write a lease.You might be able to use one of these services if you are doing this on your own.You have to collect all the information for the contract.Enter them into the online program.You will be able to print out a fully typed lease agreement at the end.
Step 15: Don't read any templates if you are not careful.
It is important that you read the complete contract carefully, even if you get a template from a lawyer, book, or online service.You should make sure that the form does not contain language that you and the other party did not intend to include.If you find provisions that you didn't expect, consider whether you want to keep them or strike them out.The landlord should be in agreement with any revisions you make.
Step 16: The lease must be signed by all parties.
If you and the other party agree that the lease says what you want it to, then you need to sign it.If there is ever a dispute about the validity of the signatures, it is a good idea to have a lease notarized.Print a copy of the lease for each party so that they have original signatures.You can refer to your lease in the future if you file it in a safe place.
Step 17: Have your lawyer review the lease.
Ask your attorney to look at the paperwork before you sign a lease.You should explain your intentions while sitting together.An attorney can make sure that what you wrote is in line with your intentions.
Step 18: Communication with the landlord needs to be kept open.
A business partnership is a commercial lease.Your landlord wants your business to succeed so he can keep getting rent money.communicate your needs to your landlord if you are having problems of any kindThe two of you should resolve the conflict early.
Step 19: Try to anticipate problems before they happen.
You don't want to be in an emergency situation where your business site is not enough.Review data, income, expenses, employee needs, and customer needs before you make a decision about your company's needs.Changes to the lease may be necessary if something is not included in your lease.
Step 20: An amendment to the lease is possible.
A commercial lease is a legally binding document.You can amend the lease if you and your landlord reach an agreement that you didn't expect.Specific reference should be made to sections of the original lease that are being affected by the amendment.The revised or added language should be included in the amendment.The amendment needs to be the same as the original lease.
Step 21: Do not rely on the same provisions.
You are expected to perform at a higher level when you are in business.There are more consumer protection laws in place to protect residential tenants because they are not expected to have certain skills.Business owners are expected to negotiate many of these protections for themselves or hire an attorney.Commercial business tenants don't usually expect certain privacy rights from their residential tenants.
Step 22: Expect to make your own lease form.
Certain provisions that will be common to all residences within a geographical area can be found in standard forms of residential leases.Commercial lease forms are not recognized.There are templates that can help, but each lease is different.Make sure the lease terms match your needs by reviewing them carefully.
Step 23: Consider the length of your commercial lease.
A commercial lease is legally binding.Businesses tend to stay in place longer so the lease terms will be longer.As you enter the deal, you need to know that you are making a serious commitment.If a residential tenant needs to break a lease early, he or she may lose a month's security deposit, but that is often the extent of the loss.Depending on how the individual lease is written, a commercial tenant may face larger consequences.
Step 24: You should be prepared to negotiate the terms of your lease.
Residential leases tend to be more restrictive than commercial ones.There are limitations to the work you can expect when you rent a house or apartment.You may be able to negotiate renovations or special features for your business with a commercial space.When you are talking about the agreement, consider this.
Step 25: Make a list of requirements.
You need to be aware of your needs before you start drafting a commercial lease.Think about the future of your business.Is your business likely to grow?Will you need more room in the future?How much visibility will you need?Is your business a cafe or bookstore that depends on public foot traffic to survive?Are you content with very limited visibility and the clients will find you, such as a dental office or private law firm?How accessible do you want to be?Do you want to live in the downtown area or do you prefer a more suburban location?What features will you need for your business?Are you opening a laser tag and video game establishment that requires special electrical wiring, or do you just need basic office lighting?Is the space you want to rent for a specific type of business?The landlord doesn't have to make sure that you can operate your business.Before entering into a deal, you should investigate this detail.
Step 26: Consider working with a commercial lawyer.
Legal work is one of the costs of doing business.The cost of consulting with an attorney in the beginning may be cheaper than getting a commercial lease that doesn't fit your needs and could lead to a legal dispute later on.
Step 27: Look for a suitable location for property spaces.
You can do the same thing if you want to rent or buy a house.A real estate agent may be able to help you draft a lease and negotiate the terms of your agreement.
Step 28: The lease terms need to be negotiated with the owner.
Discuss the terms of your agreement with the landlord when you find a suitable location.A commercial lease has more to say than a residential lease.You should think about the length of the lease rental price renovations that you would like before you take possession.